JPMorgan reportedly raised red flags about Galleon in 2001

JPMorgan Chase & Co raised concerns about Galleon hedge fund founder Raj Rajaratnam and his associates as far back as 2001, the Financial Times reported, citing an internal company document seen by the newspaper.

Rajaratnam, 52, was arrested on October 16 along with five others in what prosecutors described as the biggest hedge fund insider trading case ever.

The 2001 note, written by an analyst at the bank's alternative asset management arm, said the unit "should reduce our allocation" in Galleon's technology fund, pointing to what it described as "more negative news about Raj and his cohorts," the Financial Times reported.

The JPMorgan note alleged that the principals of Galleon "liked to operate in the 'grey areas'" of the markets, the Financial Times wrote.

Representatives for JP Morgan and Galleon did not immediately return calls seeking comment.